According to sources the fee structures parallels those of deals on Viom Networks that explored several options of public listings before being bought out by American Tower.Deepali Gupta | ET Bureau | May 04, 2016, 08:28 IST

MUMBAI: Six bankers shortlisted for the Vodafone India IPO expect to earn a fees of Rs 300 crore from what promises to be one of the country’s largest listings, raising around $2.5 billion (Rs 17,000 crore), people familiar with the matter said. The IPO could hit the markets by March 2017.

“The issue is to be launched before March and filings should start from October,” one of the people said. The lion’s share of the fees will go to Bank of America Merrill Lynch (BofA), Kotak Investment Banking and UBS that are the three leads, said one of the people. Kotak was chosen as the left lead, i.e. it will do domestic filings as well as investor management, after presentations from several banks last week.

The company also finalised ICICI Bank, Deutsche Bank and HSBC as secondary runners of the book. Internally running the process from the Indian office are Chief Executive Sunil Sood, who has been in the firm for the entirety of Vodafone's India presence. Vodafone India is country’s second largest telco by subscribers. Vodafone and HSBC declined to comment, while rest of the banks didn’t respond to emailed queries.The fee structures parallels those of deals on Viom Networks that explored several options of public listings before being bought out by American Tower, the person added.

The bankers had to submit pricing history for such transactions dating back 10 years as part of the application process to reassure Vodafone that they were not over charging for their work in the IPO.

Another person said the Vodafone IPO will be benchmarked to a premium on industry leader Bharti Airtel, because the local unit of UK’s telecom major enjoys a premium on its pricing.

India’s No. 1 telco’s market cap at close of trade on the BSE on Tuesday was nearly Rs 1,46,705 crore. “Vodafone India contributes about 14% of Vodafone Plc’s revenues and about 13% of its OIBDA, and our UK telecoms team values Vodafone India at about US$16 billion,” brokerage Macquarie said in a recent note. “In line with the telecom industry, Vodafone India’s ARPU has been declining, driven by weaker pricing power and the thrust to grow volumes to capture India’s smartphone adoption boom.”

Proceeds from the IPO, which will be stated as retiring of debt from earlier spectrum purchases and general business uses, will increase Vodafone's leverage to participate in the upcoming spectrum auctions.

Several people ET spoke with about Ericsson’s India operations, including its current and former employees, said the Stockholm-based firm has reduced headcount in the last one year or so across functions, in line with its global restructuring.